Learn from recent setbacks faced by highly valued companies like Byjus & Paytm
It is the dream of every
entrepreneur to create a company with ever increasing customers, high valuation
among investors and the brand name known all over the world. While pursuing
these goals many of them forget that unless you invest in your product upgradation, employee satisfaction & customer loyalty there is no use
in creating a brand value through heavy advertising through mass media. Recent
issues faced by Byjus, Paytm and very recently Bharatpe are all examples now
for any start-up company to learn some lessons.
Create value inward. Invest in your product, employees & customers
Even before Byjus was
called in by the authorities for enquiry, the brand faced severe backlashes
from its customers & employees. While customers were angry with the high
intense personal-call marketing tactics (they would call an existing customer
every day to market the same product) followed by non-upgradation in the product
quality (even a 6th standard kid could find out spelling mistakes in
their online study material), employees were angry at the pressure tactics used
to make them meet high targets and the way they were sacked to be replaced by
newcomers. The internet was already filled with the customer complaints and the
bad-mouthing by erstwhile employees. (This same author had warned about this in
a previous article in https://www.afaqs.com/news/advertising/hrithik-roshan-bats-for-whitehat-jr-what-will-this-do-to-the-brands-image) . Byjus as a unicorn company
soared ahead with high valuation but it was losing its inhouse brand
ambassadors (customers & employees). TATA group is an example where they
invest continuously for generations in keeping their employees and customers
loyal. Even when they face a tough situation, these two pillars - employees
& customers – always stand behind them in full support.
Slow and steady build a solid brand.
“Patience is a key element
of success,” said Bill Gates. When a man who has created a great empire out of
his business, we ought to give ears. In a recent talk show, Mr. Kochouseph Chittilappilly,
the founder of the brands like V-Guard, Wonderla & Veegaland said “All of
you know me now as a successful businessman. There were all those years behind
where no one knew I existed. Business is about building it slow and steady.”
Most start-ups nowadays
try to be a unicorn and scale up so fast that on the way up it stumbles and
start falling. The higher you go the heavier will be the fall. Recent issues faced by Byjus was due to its
scaling up in all directions with high paced acquisitions and even the
restrictions on Paytm came after its entry into every aspect of financial
business available instead of focusing and stabilizing its main business as a
payment app. These companies might of course come back but will pay a high
price for its lapses. Start ups and entrepreneurs must learn the value of
patience and build your brand slow and steady and keep all the physical and
financial infrastructure in place before scaling up.
Follow the law of the land
The cardinal rule in any
business to run in the long run is to follow the law of the land it operates.
Just by creating high valuation and bringing in high profile investments is not
a solution for your business to be in the run for a long time. Byjus was called
in by the officials for flouting several laws of the country, Paytm is facing
issues for not following several norms to be followed under RBI rules, Bharatpe
is facing issues as its co-founder has been called in by officials for breaking
financial laws. You can build a brand for a short run by spending heavily on
mass advertising but keeping it alive in the long run needs to be by following
the rules of the land. Great business thinkers has always said that the success
of any brand, any product or any technology depends on the law of the land.
Especially when you are a start up you have to know the laws, should be updated
about the changes in the laws and adhere to them steadfastly. Unlike bigger
companies a small company may not be able to face the financial struggle while
facing legal issues.
